Argentina's difficult political balance, Mercosur and trade alliances beyond Latin America

With three digit inflation rates and decades of stagnation, forty years of democracy could mean absolutely nothing. In an election in which there were record numbers of voters, the incoming President Javier Milei got outstanding support accross the entire country with equally record numbers of provinces that came out to support him. 

It is not going to be an easy task. In fact, in Parliament opposition forces still have a commanding majority that could block every single attempt to change Argentinian politics and economics. The risk is that if more than 13 million voters that supported Javier Milei come to see Parliament as a sedicious force that stands on the way preventing changes then Parliament itself will be in trouble. Could government by decree become an alternative from the very beginning?

Argentinian Constitution extract

CHAPTER III Powers of the Executive Branch Section 99.- The President of the Nation has the following powers: 1.- He is the supreme head of the Nation, head of the government and he is politically responsible for the general administration of the country. 2.- He issues the instructions and rules necessary for the enforcement of the 16 laws of the nation, without altering their spirit with regulatory exceptions. 3.- He takes part in the making of laws according to the Constitution, promulgates them and has them published. The Executive Power shall in no event issue provisions of legislative nature, in which case they shall be absolutely and irreparably null and void. Only when due to exceptional circumstances the ordinary procedures foreseen by this Constitution for the enactment of laws are impossible to be followed, and when rules are not referred to criminal issues, taxation, electoral matters, or the system of political parties, he shall issue decrees on grounds of necessity and urgency, which shall be decided by a general agreement of ministers who shall countersign them together with the Chief of the Ministerial Cabinet.

The Constitution seems to indicate that only in exceptional circumstances the President can issue decrees and that 'The Executive Power shall in no event issue provisions of legislative nature, in wichi case they shall be absolutely and irreparably null and void.'. 

It is explicitly clear that the last and final word on legislative matters lies in Parliament and it is a Parliament in which the political party supporting the President directly will have 38 representatives in the House of Reprentatives of a total of 257 and in the Senate the number of Senators directly supporting the President will be 6 out of 72. Unavoidably, the President will have to seek support of other political parties to be able to pass any bills.

Given these numbers, all the scaremongering promoted by opponents of Javier Milei is totally unjustified. It is most probable that Mauricio Macri (Former President) and Patricia Bullrich (Former Minister under Mauricio Macri) of Juntos por el Cambio (Together for Change) will have a major say. 

The bone of contention will be that Javier Milei's electoral allies will have the seats that Javier Milei needs to govern and Javier Milei will be able to say that despite not having enough seats he has the popular mandate and that people supported his electoral platform.

If the President can manage to transform an electoral coalition into a governing coalition then there will be a peaceful working political transition. If the President does not manage to transform an electoral coaliton into a governing coalition then there will be political upheaval leading to dangerous political uncertainties.

In Uruguay, there are divisions in terms of supporting or not supporting Javier Milei. For example, Frente Amplio (Broadfront) in opposition was more inclined to support the losing candidate Sergio Massa. In Brazil, President Lula came openly in support of Sergio Massa. Javier Milei for starters indicated that he wanted to get rid of Mercosur - something he might not achieve given the fact that he will be effectively in coalition with Mauricio Macri and Patricia Bullrich.

Uruguay has expressed that it wants ever closer trade relations with China, independently of its membership of Mercosur. Argentina itself has plans to incorporate Chinese communications technology. Brazil is seeking a new alignement having become a supporter of new trade arrangements that will bring the country closer to economies linked to the Russian Federation and China.

In spite of the fact that there are other Latin American economies linked to Mercosur, Argentina, Brazil and Uruguay are the core of the trading block.

Javier Milei: New President for Argentina

The electoral success of Javier Milei was such that Sergio Massa - the Justicialista contender - spoke before official data was published to concede.

It was essential for Sergio Massa to make vows for a peaceful and proper transition indicating that dialogue and peaceful coexistence are the rule in a country with extraordinary high inflation rates.

The key word is change. 'We need change. We cannot expect improvements if we keep implementing the same policies over and over again'. 

On December 10th, 2023, the new President will be officially, formally, inaugurated. Time to have a look at the new Argentinian Parliament. Javier Milei was successful in most Argentinian provinces and this includes Buenos Aires where he was successful in areas that had traditionally supported Justicialismo (Peronismo).

It is foreseen that from this evening within Justicialismo a leadership struggle is just beginning and that former President and now also former Vice President Cristina Fernandez will lead Justicialismo once Sergio Massa lost the Presidential Election.

There will also be a new balance of forces within the Union Civica Radical that divided itself. Some chose to support Sergio Massa and most of them chose to support Javier Milei. It is also said that, in spite of getting 56% of the votes, given the need to reach agreements in Parliament to be able to govern, the new President will have to be more moderate than he appeared to be during the electoral campaign.

The size and role of the state will be at stake. The general philosophy is to reduce the Welfare State to promote employment, to stop paying people not to work. There will be both ideological and financial changes. With three digit inflation rates, a huge effort will have to be made to generate enough jobs to be able to cut the Welfare State without a major upheaval and this indicates that any changes will have to be gradual in a country in which a very high percentage of its population lives below poverty levels.

Javier Milei indicated that he has in mind a different idea regarding Mercosur, but this will have to wait while the new President tries to sort out the internal situation in Argentina.

Commentators define Javier Milei as a charismatic leader and that charisma is based on success and that the electorate chose Javier Milei because they expect miracles and that to be able to produce miracles the new President will soon be in a collision course with traditional political forces that chose to support him to defeat Justicialismo. 

Argentina is a country in which both Cristina Fernandez and Mauricio Macri (one Justicialista and another Radical) have still a strong power base. Regardless of the electoral success (56%), the new President will have to navigate in a country in which he will have to deal with powerful foes and friends that have their own political agendas. It has been said that younger generations belonging to the upper middle class are leaving the country and that a high number of the younger generations that belong to the lower middle class no longer believe in democracy.

Argentina: Falklands and Political Persecution

Argentina: Falklands and Political Persecution

Every time there is political upheaval in Argentina, there is talk about the South Atlantic Islands.

Why? Because it is an easy way to divert attention from the real problems Argentina is facing. 

In spite of the size of Argentina, most of the economic activity of Argentina is focused on what is known as Gran Buenos Aires. Vast areas of Argentina are empty. The fact that transport connections in Argentina are an absolute disaster doesn't make things easy. Reaching certain parts of Argentina is almost impossible and this is why much of the population of Argentina is based a few highly populated centres. Argentina has a bipolar political system. This means that very antagonistic parties have ruled Argentina with the exception of periods when the country has been under Military Dictatorships. This doesn't allow Argentina to have a balanced political system. Those who have watched the movie series The Godfather will easily understand how the political system in Argentina works or doesn't work. Going from crisis to crisis accompanied by the usual witch hunts, the country is an ongoing human tragedy.

In 1982, the Military Junta headed by General Leopoldo Fortunato Galtieri was facing the possibility of a revolt in spite of the power of the state and of organised repression. Despite the role of Argentina together with Chile, Uruguay, Brazil and other countries in a system designed by the United States of America to watch over the 'US backyard' to prevent the spread of Communism across Latin America, relations between the members of such club had been seriously undermined by regional disputes. One of such disputes was focused on the Beagle - a territorial bone of contention for Argentina and Chile. Had not been for a Papal Mediation supported by Uruguay, Argentina and Chile - both under Military Regimes - would have gone to war. The conflict was avoided but there was little trust left. Argentina was also competing with Brazil and rivalry between the two Latin American giants has been a feature of Latin American regional relationships for a very long time.

General Leopoldo Galtieri invaded the South Atlantic Islands in what we know as the Falklands War in an attempt to galvanise public opinion in Argentina. The Military Junta was playing for time. The Argentinian Military thought that Britain would not react as it did. For a short-time, the mass media could talk about something that more or less united the Argentinian peoples in a country in which more than 30,000 people seen as Left-Wing were slaughtered by the Argentinian Military Regime that invaded the South Atlantic Islands. 

When I see Labour Party followers and supporters of other Left-Wing organisations supporting the Military Junta of Argentina, I ask myself if those Labour Party followers and supporters actually have a brain to discern what they are talking about. Communists were killed. Socialists were killed. People who supported moderate segments of traditional political parties were killed. Seeing an alliance of Jeremy Corbyn and General Leopoldo Fortunato Galtieri is a very strange thing to see and hear about.

When Argentina invaded the South Atlantic Islands, Chile ruled by General Augusto Pinochet did everything in its power to help the United Kingdom facilitating British military operations in the South Atlantic Region. Without the support provided by General Augusto Pinochet, British military operations in the South Atlantic Region would have been difficult, not to say impossible.

What does the British public know about it? Very little. The Labour Party, for example, supported the Argentinian Dictatorship and hated the Military Regime headed by General Augusto Pinochet. They still do. Their understanding of Latin American Affairs is very limited. They love the enemies of Britain and hate those who helped Britain in its hour of need.

Both France and Israel helped Argentina providing the firepower including Mirage Jets and Exocet Missiles. The Argentinian Military Junta had two major concerns: the internal enemies and the external enemies. They needed to maintain most of its Armed Forces in Argentina for fear of an internal rebellion and of a Chilean attack. In the end, the Argentinian Navy played a very minor role in the conflict. Most of the soldiers sent to the South Atlantic Islands were actually conscripts. Argentina didn't have the logistical strength to support the invading forces and the Air Force was left alone to attack British ships in an attempt to delay the arrival of British troops.

It is no secret today that the Argentinian economy is a mess. The country is struggling to keep its creditors at bay and had not been for British support Argentina would have little access to credit facilities. In spite of Britain's support, President Mauricio Macri and his predecessor Cristina Fernández have both used the South Atlantic Islands as diversion from internal political and financial upheaval.

Despite the fact that the Military Junta of 1982 is now history, political persecution goes on. Putting aside genuine cases involving misuse of public funds, Argentinian Prosecutors are going against individuals whose sole crime is to have supported a particular ideological stance. In an effort to use individuals identified as support of the previous President as scapegoats 'to set an example', the Argentinian government of President Macri is attacking innocent people. Yet another political diversion to make the public look in the opposite direction and obvious own-goal.